EU’S SHAME: Russia has been strangling gas supplies for years but EU too PETRIFIED to act

LEAKED EU documents reveal that state-run Russian energy giant Gazprom has been strangling European gas supplies for years and deliberately violating EU energy law for close to a decade, with the EU doing little to challenge it.

The “abusive practices” carried out by the energy giant were highlighted in an internal European Commission document relating to a seven-year old anti-trust dispute, which was leaked on Tuesday.

The document, which was part of the EU’s longest ever investigation, found that Gazprom had engaged in behaviour which amounted to political bullying, exerting pressure over vulnerable nations in Eastern Europe and fragmenting the unified EU energy market with deceptive pricing policies.

Professor Alan Riley, EU energy law expert at the Atlantic Council, said: “This is a very big deal. What the documents show is that there was systematic abuse of dominant position, and that it was clearly done for political purposes.

“Gazprom was splitting the European energy market at every point. And now the Commission is minded to do a deal that treats the East Europeans as if they were not member states at all.”

GETTY

Gazprom was found to be fragmenting the EU energy market with deceptive pricing policies

Related articles

What the documents show is that there was systematic abuse of dominant position, and that it was clearly done for political purposes

Professor Alan Riley

The leak is highly embarrassing for the the EU’s competition directorate, as it implies the Commission gained a full understanding of the “abusive” techniques employed by the company, and nevertheless turned a blind eye, with large countries such as Germany benefitting.

Polish politicians have accused countries such as Germany of wielding a large influence in EU institutions to suppress the findings and reach an amicable agreement with Gazprom in order to maintain their beneficial standing.

Jacek Saryusz-Wolski, a Polish MEP, said: “What we’re told is that the Commission wants an amicable settlement and has already decided to do this deal. It is disloyal and Poland is one of the victims, but not the only one.

“The documents show beyond any doubt that Gazprom has trespassed on EU law for years, and the Commission is about to issue a de facto acquittal anyway. They are they are doing this in the context of a silent war by Russia. This is all about vested interests.”

The EU raided Gazprom offices in European cities in 2011, and seized over 150,000 files.

GETTY

The EU raided Gazprom offices in European cities in 2011, and seized over 150,000 files

The document commented on this behaviour, saying: “The purpose was to segment the internal market along national borders.

This meant that Gazprom could impose “unfair pricing” in eastern European regions by leveraging its “dominant position”.

The report cast its final judgment, saying: “The Commission considers that the infringement has been committed intentionally. Gazprom is fully aware of the illegal nature of at least some of the various contractual and non-contractual measures.”

The Commission also called for fines of 30pc of relevant sales, or up to 10pc of total turnover.

GETTY

Gazprom charged $350 per 1000 cubic metres of gas in Poland, compared to $200 in Germany

The illegal behaviour appears to be part of a politically motivated move, by “obtaining certain non-related commitments” which differ from country to country.

Notably, Gazprom was found to be charging $350 per 1000 cubic meters of gas in Poland, compared with $200 in Germany.

This appears to be part of a tactic to punish Poland for refusing to give up control over their section of the Yamal pipeline to the Russians.

Germany, however, has been enjoying an advantageous deal with Gazprom, achieving a competitive advantage in terms of gas prices over their eastern European neighbours.

The report also showed that Gazprom employed a variety of techniques to divide EU nations, including re-export bans, restrictions on metering stations, destination clauses, and refusal to change delivery points.

EU officials commented on this, saying: "Unfair and politically driven pricing (linked to the Russian Federation's policy in CEE) is the focal point of Gazprom corporate strategy.”